IN THE MAGISTRATE DIVISION
OF THE OREGON TAX COURT
Property Tax
K.D. AND JUDY A. THOMAS,
Plaintiffs,
v.
YAMHILL COUNTY ASSESSOR,
Defendant.
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No. 001095B
DECISION
A case management conference was held on December 4, 2000. Judy Thomas
and Debi Laue participated for plaintiffs. Jay D. Lawson represented defendant. Two
issues were presented: 1) the amount of additional tax due upon the disqualification of tax
lot 2001, and 2) the real market value on the roll for tax lots 2000, 2001, and 2002 for the
1997-98, 1998-99 and 1999-00 tax years, while each was specially assessed as farm
land.
STATEMENT OF FACTS
Plaintiffs have owned this rural land for several years. According to the defendant's
representative at the December 4, 2000 case management conference, "it is some of the
most prime farm land in all of Yamhill County." The land in each tax lot was earlier
designated as farm land and received a special, reduced assessment.
Upon the disqualification of tax lot 2001 from farm use assessment, plaintiffs
received a tax bill for an additional tax of about $8400, which prompted this appeal.
Plaintiffs agree with the disqualification action, but contest the amount of the additional
"pay-back" taxes. The computation of the amount due was based on defendant's real
market value (RMV) conclusions for the years preceding disqualification.
DECISION
1
Defendant now admits that earlier RMVs on the roll are excessive due to certain
market forces, including flooding, that were not recognized as factors in calculating the
RMVs for the years at issue. For instance, the county’s original 1999-00 RMV for tax lot
2001 was $457,898. The county’s new recommended RMV for that tax year is $293,370.
The county also recommends that the 1999-00 RMV for tax lot 2002, which recently sold
for $270,000, be reduced from $405,926 to $267,605.
Plaintiffs agree with defendant’s recommended RMV reductions. Defendant's
revised RMV recommendations for all three accounts are as follows:
1. Tax Lot 2000, Account No. 106566: specially assessed (land only)
Tax Year
RMV
MAV
SAV
1997-98
466,964
340,884
204,231
1998-99
461,098
351,111
208,912
1999-00
504,153
361,644
215,178
Revised RMV
395,732
2. Tax Lot 2001, Account No. 504946: disqualified
Tax Year
RMV
MAV
SAV
Revised RMV
1997-98
436,093
318,348
770
293,370
1998-99
436,093
327,898
792
293,370
1999-00
457,989
337,735
815
293,370
3. Tax Lot 2002, Account No. 504949: specially assessed
Tax Year
RMV
MAV
SAV
Revised RMV
1997-98
386,596
282,215
84
267,605
1998-99
386,596
290,681
86
267,605
1999-00
405,926
299,401
88
267,605
DECISION
2
Tax lot 2001 has been disqualified, for which plaintiffs are charged with back-taxes. Tax
lots 2000 and 2002 remain in special farm use assessment.
ISSUES PRESENTED
(1) For tax lot 2001, shall defendant recalculate the additional tax due using the
revised RMV figures; and
(2) Does this court have the authority to make RMV revisions, as stipulated by the
parties, to the roll for tax lots 2000, 2001, and 2002 for the 1997-98, 1998-99, and 199900 tax years, where the revised values would still lie above the specially assessed farm
values?
COURT'S ANALYSIS
Where both parties stipulate to revised values, the court generally allows a
correction of the RMV. First, it is important to review the effect of such a correction.
Typically, assessed value (AV) is the lesser of RMV or maximum assessed value (MAV).
ORS 308.146(2).1 With specially assessed farm property, the AV is calculated according
to ORS 308A.092, resulting in the SAV (specially assessed value).
(1) For the 1997-98 tax year, tax lot 2001 was taxed based on the specially
assessed value (SAV) of $770. The lot was taxed based on a SAV for the following two
years as well. After taking into consideration certain market forces and some flooding that
occurred, defendant recommended some revised figures to more accurately reflect the
market values. However, even if defendant's recommended revised RMV of $293,370 for
the 1997-98 tax year were substituted for the RMV on the record, the property would still be
assessed based on the SAV because it is lower than the revised RMV.
1
All references to the Oregon Revised Statutes are to 1999.
DECISION
3
However, when property is disqualified from special assessment, the taxpayer must
pay back-taxes on the property. See ORS 308A.703(2). The tax due includes the
difference between the tax that would have been paid without special assessment and the
tax that was paid with special assessment. ORS 308A.703(2). Tax lot 2001 has been
disqualified and plaintiffs owe additional taxes as a result.
Defendant calculated plaintiffs' back taxes for tax lot 2001 using the values as they
exist on the roll. That is, for the 1997-98 tax year, plaintiffs' additional tax includes the
difference between the taxes plaintiffs paid on the SAV of $770 and the taxes plaintiffs
would have paid without special assessment. Without special assessment, plaintiffs would
have paid tax on an AV of $318,348, the lesser of the RMV and the MAV for that tax year.
See ORS 308.146(2).
In contrast, if defendant had used the revised RMV of $215,985, which would be the
AV for 1997-98 because it is lower than the MAV, plaintiffs' additional tax for the 1997-98
tax year would have been lower. That is also true for the 1998-99 and 1999-00 tax years.
Thus, the court requires that defendant recalculate the additional tax due for lot 2001 using
the revised RMVs for each year.
(2) Plaintiffs seek a reduction in the 1999-2000 RMV (land only) of tax lot 2000
from $504,153 for land only. Defendant's representative agreed to reduce that RMV to
$395,732 after taking into consideration market forces and flooding. That lot is specially
assessed at $215,178, a value lower than the parties' proposed reduction.
Plaintiffs also seek RMV reductions for tax lots 2001 and 2002. The revisions on
the roll sought for tax lot 2001 are changes from $436,093 to $293,370 for the 1997-98 tax
year, which was specially assessed at $770; $436,093 to $293,370 for the 1998-99 tax
DECISION
4
year, which was specially assessed at $792; and $457,989 to $293,370 for the 1999-00
tax year, which was specially assessed at $815. The revisions on the roll sought for tax lot
2002 are changes from $386,596 to $267,605 for the 1997-98 tax year, which was
specially assessed at $84; $386,596 to $267,605 for the 1998-99 tax year, which was
specially assessed at $86; and $405,926 to $267,605 for the 1999-00 tax year, which was
specially assessed at $88.
In order to appeal to the court, a taxpayer must be aggrieved, as defined by
ORS 305.275(1)(a). When a property's AV is less than its RMV, the taxpayer is not
aggrieved within the meaning of ORS 305.275. See Parks Westsac L.L.C. v. Dept. of
Rev., 15 OTR 50, 52 (1999).
For the years at issue, all the lots were specially assessed. Even if plaintiffs were to
receive the reductions on the roll they seek, each of the revised RMVs lies above the
corresponding SAVs. Plaintiffs' taxes for the years at issue would not change and they
would not receive a refund. Plaintiffs' claim is not justiciable because they do not suffer a
harm. See Kaady v. Dept. of Rev., 15 OTR 124, 125 (2000).
Defendant's representative agreed to reduce the RMVs as stated above.
Defendant is free to change its official record as appropriate. The portion of plaintiffs'
appeal concerning a change in RMVs on the tax roll for lots 2000, 2001, and 2002 is
dismissed as nonjusticiable.2
2
If the issues were justiciable, plaintiffs’ value appeals for the 1997-98 and
1998-99 tax years would likely be dismissed for failure to timely file, unless the tax court
found that the difference in value was 20% or greater or "good and sufficient cause"
existed for failing to timely appeal. See ORS 305.288. ORS 309.100 requires that RMV
appeals be filed with the board of property tax appeals by December 31 of the tax year to
which the appeal applies.
DECISION
5
CONCLUSION
IT IS THE DECISION OF THIS COURT that defendant recalculate the additional tax
due for lot 2001 using the revised RMVs for the 1997-98, 1998-99, and 1999-00 tax years.
IT IS FURTHER THE DECISION OF THIS COURT that the portion of plaintiffs'
appeal concerning a change in RMVs on the tax roll for lots 2000, 2001, and 2002 is
dismissed as nonjusticiable.
Dated this ____ day of February, 2001.
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JEFF MATTSON
MAGISTRATE
IF YOU WANT TO APPEAL THIS DECISION, FILE A COMPLAINT IN THE REGULAR
DIVISION OF THE OREGON TAX COURT, 1241 STATE STREET, FOURTH FLOOR,
SALEM, OR 97301-2563. YOUR COMPLAINT MUST BE SUBMITTED WITHIN 60
DAYS AFTER THE DATE OF THE DECISION OR THIS DECISION BECOMES FINAL
AND CANNOT BE CHANGED.
THIS DOCUMENT WAS SIGNED BY MAGISTRATE JEFF MATTSON ON
FEBRUARY 26, 2001. THE COURT FILED THIS DOCUMENT ON FEBRUARY 26,
2001.
DECISION
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